Growers and traders in India adjust to conditions following extensive weather-related damage to the current kabuli crop

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Last month’s extreme weather in the important kabuli chickpea growing region of Madya Pradesh sent the local industry into a tailspin. With harvest nearing completion, members of the farming community have confirmed that production of kabuli will be at its lowest in four years.

The final production estimate, according to Sanndip Goyal of Ganesh Agro Foods, is between 300,000 and 350,000 MT. Arrivals of the new kabuli crop have been down 70% compared to the past two years.

“Prices for Indian kabuli chickpeas, which were being traded during the month of February at levels of US$ 900-950 per MT (FOB) for 42/44 count, are today being offered  at US$ 1125–1150 per MT (FOB),” Goyal informed IFT recently.

This situation has prompted the international community to turn its attention to other origins like Mexico, causing an upswing in demand there. In February, Mexican chickpeas were selling for US$ 1000-1020 per MT (FOB) for 42/44 count but are now going for US$ 1220-1240 per MT (FOB). Indian companies bought up large quantities of the Mexican product to cover their shortfall, and other countries with high kabuli demand like Turkey and Algeria have followed suit.

“Judging from the reaction of the two biggest kabuli chickpea-producing countries last month, we can clearly expect relative strength in prices in 2014,” Goyal observed.

Production volume for Indian kabuli isn’t the only thing that has suffered as a result of the torrential rains and golfball-sized hail that hit the region. Quality is also a major worrying factor, and high percentages of stained and damaged chickpeas have been reported throughout the industry. Goyal says this contributes a major portion to the total permissible defect level for exported chickpeas.

“The total permissible defect allowed for exports of large chickpeas (40/42, 42/44, 44/46 count) is 4%, to which stained and damaged chickpeas are contributing almost 2.25%. In previous years, stained and damaged were just under 1% of the total defect,” he said.

“Traders buying [kabuli chickpeas] from India should keep in mind that the Indian crop witnessed heavy rainfall just before the harvest, so there might be some quality issues, for which the supplier should not be made responsible as no one can control product damage due to weather,” Goyal added.

Middle Eastern demand for kabuli chickpeas is expected to jump this month, which marks the celebration of Ramadan. Meanwhile Indian pulses like pigeon peas, black mapte, green mung and masoor (brown lentils) are all trading at higher levels.

“Bean prices in China and elsewhere are also firm,” Goyal said. “So speaking fundamentally it will not be easy for buyers to divert from kabuli chickpeas to alternative beans, pulses or lentils. The kabuli chickpea market should remain strong in the coming months, and we may see a very interesting trading month indeed.”

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Charlie Higgins, IFT Journalist

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